Case Study Pones Suppliers limited started out as a small manufacturer of custom-built electronic circuits based on specific orders and design requests of customers. As demand increased the company switched to manufacturing standard electronic components based on manufacturers who were mass producing electrical equipment. Pones was no longer relying on orders to initiate the manufacturing process but instead producing large volumes as they had established a reputation and were confident that for each period there would be sustained demand. As production quantities grew Pones Suppliers realised that inventory management was beginning to become a significant issue as costs of storage, obsolescence and other inventory holding costs began to mount. These problems were exacerbated by other instances where they were out of stock of critical supplies and these instances threatened the reputation and brand name of the company. To cope with these issues the company decided to incorporate principles of demand forecasting to guide production planning with the expectation that this would lead to more efficient procurement of raw materials and scheduling of production staff. The data below provided below relates to actual sales over several periods: Time Period Components Sold Period 1 600 Period 2 720 Period 3 950 Period 4 1100 Period 5 850 Period 6 1200 Required: A. Describe THREE (3) components of a demand forecast. Ensure your description explains how each element may impact the outcome of the demand forecast. (6 marks) B. Explain the role of forecasting in the supply chain. Your explanation should include TWO (2) reasons why players in the supply chain would consider forecasting essential. (6 marks) C. Given that the forecast for period 1 was 400 units, use exponential smoothing to forecast demand for the data relating to Pones Ltd for periods 2 to 6 based on an exponential smoothing constant of 0.80. (5 marks) D. Use the MAD to calculate the relative accuracy of the demand forecast. (3 marks) (Total 20 marks)